http://thehackernews.com/2011/12/government-organised-12-chinese-hacker.html

How far will these attacks go? What will eventually happen if they don't stop?

Could this potentially lead to a full blown war? I really think it could, especially if an attack is large enough.

I doubt the US would pull the trigger on a full blown cyber war except for very specialty, tactical operations.  Even then they'd go out of their way to prevent escalating with an entity like China that has a fully operational cyber warfare capability.  Remember, the US is in an awkward position.  We have possibly (probably) the most powerful cyber weapon platforms in the world, but we are also, by far, the most susceptible to cyber attacks.  China would be thrilled to go toe-to-toe with us in a cyber war because at the end of the day the majority of their population can still walk out the front door and farm.  The US is the exact opposite. If a cyber strike took out power, supply chains, etc then the majority of our population would die of starvation in a week.  It is asymmetric warfare in spades.